31SICAM

vs. JORGE, G.R. NO. 159617, August 8, 2007

Facts: Lulu Jorge pawned several pieces of jewelry with Agencia de R.C.
Sicam to secure a loan in the amount of P59, 500.00. It was alleged that two
armed men entered the pawnshop and took away whatever cash and
jewelry found inside the pawnshop vault. It was reported to the police. She
sued for damages but Sicam interposed the defense of fortuitous event,
alleging that there was robbery.
Issue: WON Sicam is guilty of negligence in the operation of her pawnshop
business.
Ruling: A fortuitous event is by definition an extraordinary event not
foreseeable or avoidable. In order for a fortuitous event to exempt one from
liability, it is necessary that one has committed no negligence or misconduct
that may have occasioned the loss and robbery per se, just like carnapping,
is not a fortuitous event for it does not foreclose the possibility of negligence
on the part of herein petitioners.
A review of the records clearly shows that petitioners failed to exercise
reasonable care and caution that an ordinarily prudent person would have
used in the same situation. No sufficient precaution and vigilance were
adopted by petitioners to protect the pawnshop from unlawful intrusion.
There was no clear showing that there was any security guard at all. Thus
petitioners are guilty of negligence in the operation of their pawnshop
business.

32

MERALCO vs. RAMOY, G.R. NO. 158911, March 4, 2008

Facts: In the year 1987, the National Power Corporation (NPC) filed a case
for ejectment against several persons allegedly illegally occupying its
properties among the defendants in the ejectment case was Leoncio
Ramoy. On June 20, 1999 NPC wrote to MERALCO requesting the
immediate disconnection of electric power supply to all residential and
commercial establishments beneath the NPC transmission lines along
Baesa, Quezon City. In due time, the electric service connection of the
plaintiffs was disconnected. During the ocular inspection ordered by the
Court, it was found out that the residence of the plaintiffs-spouses was
indeed outside the NPC property.
Issue: WON MERALCO was negligent in its disconnection of electric
services toward respondent.
Ruling: The respondents' cause of action against MERALCO is anchored
on culpa contractual or breach of contract for the latter's discontinuance of its
service to respondents. Article 1173 also provides that the fault or negligence
of the obligor consists in the omission of that diligence which is required by
the nature of the obligation and corresponds with the circumstances of the
persons, of the time and of the place, hence, as a public utility, MERALCO
has the obligation to discharge its functions with utmost care and diligence.

33MINDANAO

TERMINAL AND BROKERAGE SERVICE,

INC. vs. PHOENIX ASSURANCE COMPANY OF NEW
YORK, MCGEE & CO., INC., G.R. NO. 162467, May 8, 2009
Facts: (Del Monte) contracted petitioner, a stevedoring company, to load
and stow a shipment of cartons of fresh green Philippine bananas and
cartons of fresh pineapples belonging to (Del Monte Produce) into the
cargo hold of the vessel M/V Mistrau. Del Monte Produce insured the
shipment under an open cargo policy with private respondent (Phoenix), a
non-life insurance company, and private respondent McGee & Co. Inc.
(McGee), the underwriting manager/agent of Phoenix.
It was then discovered upon discharge that some of the cargo was in bad
condition. It was stated that a large number of cartons of the banana
shipment and cartons of the pineapple shipment were so damaged that
they no longer had commercial value.
Issue: WON Mindanao Terminal is liable for not having exercised
extraordinary diligence in the transport and storage of the cargo.
Ruling: Mindanao Terminal was required to observe ordinary diligence only
in loading and stowing the cargoes of Del Monte Produce aboard M,V
Mistrau since there is nothing in the contract which requires a higher degree
of diligence. If the law or contract does not state the degree of diligence
which is to be observed in the performance of an obligation then that which
is expected of a good father of a family or ordinary diligence shall be
required.

34COMGLASCO

CORPORATION/AGUILA GLASS vs. SANTOS CAR

CHECK CENTER CORPORATION, G.R. No. 202989, March 25, 2015
Facts: Respondent Santos Car Check Center Corporation (Santos) owner
of a showroom, leased out the said space to petitioner Comglasco
Corporation (Comglasco), an entity engaged in the sale, replacement and
repair of automobile windshields, for a period of five years.
When Comglasco advised Santos through a letter that it was preterminating their lease contract, Santos refused to accede to the pretermination, reminding Comglasco that their contract was for five years.
Comglasco vacated the leased premises and stopped paying any further
rentals. Santos sent several demand letters, which Comglasco completely
ignored. Santos then filed suit for breach of contract.
Issue: WON Comglasco is to comply with its obligation under the Contract
of Lease and pay its unpaid rentals.
Ruling: Mere pecuniary inability to fulfill an engagement does not discharge
a contractual obligation, nor does it constitute a defense to an action for
specific performance. The pre-termination of the lease by Comglasco was
not due to any fault of Santos, and Comglasco completely ignored all four
demands of Santos to pay the rentals, thereby compelling Santos to sue to
obtain relief.

35NAKPIL & SONS v. CA, G.R. NO. L-47851 April 15, 1988

37UNIVERSAL

FOOD CORPORATION vs. THE COURT OF

APPEALS, G.R. NO. L-29155 May 13, 1970

Facts: The private respondent (Philippine Bar Association) hired the

services of the petitioner to make the plans and specifications for the
construction of their office building. The building was completed by the
contractor but subsequently, an earthquake struck causing its partial
collapse and damage.

Facts: Respondent patentee was dismissed as the permanent chief

chemist of the corporation without any fault or negligence on his part after
the execution of the Bill of Assignment, prompting him to rescind the
contract.

Issue: WON the petitioners are liable for damages.

Issue: WON rescission of the Bill of Assignment is proper.

Ruling: The petitioner made substantial deviations from the plans and
specifications and failed to observe requisite workmanship standards in the
construction of the building while their architect drew plans that contain
defects and other inadequacies. Both the contractor and the architect
cannot escape liability for damages when the building collapsed due to an
earthquake. Other buildings in the area withstood the tremor. One who
creates a dangerous condition cannot escape liability even if an act of God
may have intervened as in this case. As such, the liability of the contractor
(herein petitioner) and the architect for the collapse of the building is solidary.

Ruling: The general rule is that rescission of a contract will not be permitted
for a slight or casual breach, but only for such substantial and fundamental
breach as would defeat the very object of the parties in making the
agreement. In this case the dismissal of the respondent patentee Magdalo
V. Francisco, Sr. as the permanent chief chemist of the corporation is a
fundamental and substantial breach of the Bill of Assignment. He was
dismissed without any fault or negligence on his part.

38JAVIER vs. CA, G.R. No. L-48194 March 15, 1990

36ALMEDA vs.

BATHALA MARKETING,G.R.NO.150806, January 28,

2008
Facts: In May 1997, Bathala Marketng, renewed its Contract of Lease with
Ponciano Almeda. Under the contract, Ponciano agreed to lease a porton of
Almeda Compound for a monthly rental of P1,107,348.69 for four years. On
January 26, 1998, petitioner informed respondent that its monthly rental be
increased by 73% pursuant to the condition No. 7 of the contract and Article
1250. Respondent refused the demand and insisted that there was no
extraordinary inflation to warrant such application. Respondent refused to
pay the VAT and adjusted rentals as demanded by the petitioners but
continually paid the stipulated amount. RTC ruled in favor of the respondent
and declared that plaintiff is not liable for the payment of VAT and the
adjustment rental, there being no extraordinary inflation or devaluation. CA
affirmed the decision deleting the amounts representing 10% VAT and
rental adjustment.
Issue: Whether the amount of rentals due the petitioners should be
adjusted by reason of extraordinary inflation or devaluation
Ruling: Petitioners are stopped from shifting to respondent the burden of
paying the VAT. 6th Condition states that respondent can only be held liable
for new taxes imposed after the effectivity of the contract of lease, after 1977,
VAT cannot be considered a new tax. Neither can petitioners legitimately
demand rental adjustment because of extraordinary inflation or devaluation.
Absent an official pronouncement or declaration by competent authorities of
its existence, its effects are not to be applied.
Petition is denied. CA decision is affirmed.

40PAY vs. PALANCA, G.R. NO. L-29900June 28, 1974

Facts: Oppositor-appellee alleged that the rights of the petitioner-creditor

had already prescribed when the action based on a dated promissory note
was filed 15 years after.
Issue: WON a promissory note to be paid upon demand is immediately
due and demandable

Facts: Petitioner and private respondent entered into an agreement into

which Petitioner bound himself to transfer his rights(shares of stocks) on
Timberlwealth Corp to private respondent.
That for and in consideration of the transfer of rights, Petitioner undertake to
pay Private Respondent subject to the condition that the application of
Private Respondent for an additional area for forest concession be
approved by Bureau of Forestry. Private Respondent did not obtain the
approval
Issue: WON an agreement may be nullified for non-performance of the
conditions stipulated therein
Ruling: When a contract is subject to a suspensive condition, its birth and
effectivity can take place only if and when the event which constitutes the
condition happens or is fulfilled, and if the suspensive condition does not
take place, the parties would stand as if the conditional obligation had never
existed.

39HONGKONG AND

SHANGHAI BANKING CORP. vs. BROQUEZA,

G.R. NO. 178610 November 17, 2010
Facts: Respondents executed undated promissory notes. They were not
able to pay the monthly amortizations of their respective loans, which were
supposed to be paid through salary deduction, to the petitioner because of
their dismissal.
Issue: WON the loan is immediately demandable.
Ruling: Loans secured by their future retirement benefits to which they are
no longer entitled are reduced to unsecured and pure civil obligations and
the absence of a period within which to pay the obligation, the fulfillment of
which is demandable at once.

Ruling: The wordings of the promissory note being "upon demand," the
obligation was immediately due and had prescribed upon the lapse of ten
years from the date on the promissory note.